February 22, 2009

Life in the economic paradise of Dubai

Dubai airport clogged with cars abandoned by fleeing construction workersThe roads around Dubai airport are clogged with abandoned cars left behind by guestworkers from the construction industry who are fleeing the country ahead of the economic collapse:

On the night of December 31, 2008 alone more than 80 vehicles were found at the airport. "Sixty cars were seized on the first day of this year," director general of Airport Security, Mohammed Bin Thani, told DNA over the phone. On the same day, deputy director of traffic, colonel Saif Mohair Al Mazroui, said they seized 22 cars abandoned at a prohibited area in the airport.

Faced with a cash crunch and a bleak future ahead, there were no goodbyes for the migrants -- overwhelmingly South Asians, mostly Indians - just a quiet abandoning of the family car at the airport and other places.

While 2,500 vehicles have been found dumped in the past four months outside Terminal III, which caters to all global airlines, Terminal II, which is only used by Emirates Airlines, had 160 cars during the same period...

"The construction and real estate industry has been hit following the global slowdown and the direct fallout is that professionals working in the realty industry are rapidly losing their jobs," said a senior media professional, in-charge of a realty supplement in Dubai. "In fact, my weekly real estate supplement usually had 60% advertisement and ran into 300-odd pages. In the last seven weeks, it's down to 80 pages and with fewer advertisments," he added.

Short of opening a Radio Shack in an Amish town, Dubai is the world�s worst business idea, and there isn�t even any oil. Imagine proposing to build Vegas in a place where sex and drugs and rock and roll are an anathema. This is effectively the proposition that created Dubai - it was a stupid idea before the crash, and now it is dangerous.

It looks like Manhattan except that it isn�t the place that made Mingus or Van Allen or Kerouac or Wolfe or Warhol or Reed or Bernstein or any one of the 1001 other cultural icons from Bob Dylan to Dylan Thomas that form the core spirit of what is needed, in the absence of extreme toleration of vice, to infuse such edifices with purpose and create a self-sustaining culture that will prevent them crumbling into the empty desert that surrounds them.

Instead of moving toward greater transparency, the emirates seem to be moving in the other direction. A new draft media law would make it a crime to damage the country�s reputation or economy, punishable by fines of up to 1 million dirhams (about $272,000). Some say it is already having a chilling effect on reporting about the crisis.

Last month, local newspapers reported that Dubai was canceling 1,500 work visas every day, citing unnamed government officials. Asked about the number, Humaid bin Dimas, a spokesman for Dubai�s Labor Ministry, said he would not confirm or deny it and refused to comment further. Some say the true figure is much higher.

�At the moment there is a readiness to believe the worst,� said Simon Williams, HSBC bank�s chief economist in Dubai. �And the limits on data make it difficult to counter the rumors.�

And the irony is that Dubai was supposed to be the economic engine that powered their kingdoms after their oil ran out. It will come back but not as strong as it was before -- investors will be shy and people that were forced to flee will not feel comfortable about coming back.
Having an incomplete infrastructure doesn't help either...
Posted by DaveH at February 22, 2009 1:44 PM